NGK and the EnvironmentAt NGK, our Environmental Philosophy seeks to contribute to solutions supporting global environmental conser-vation. We conduct environmental conservation activities as an integral part of business operations in our driveto contribute to the realization of a recycling-based society. In line with our Corporate Philosophy, which states“NGK products and technologies must create new value and contribute to the quality of life,” we seek todevelop solutions to environmental challenges through our work in the “Triple-E” business domains of Energy,Ecology and Electronics. Based on environmental action guidelines, we develop and improve environmentalmanagement systems, and are introducing an environmental accounting system and working to obtain ISO14000 certification. We also carry out educational and public relations activities, such as publication of an Environmental & Social Responsibility Report, to raise environmental awareness among employees and thegeneral public. NGK and SocietyWorking toward the goal of becoming an excellent company, NGK, as a good corporate citizen, seeks toimprove the lives of all people through community relations activities based on a global perspective. Wepromote practical activities that are characteristic of NGK, founded on the four concepts of “Globalism,”“Community Contributions,” “Employee Participation,” and “Continuity.”Five-year Environmental Action PlansFirst Five-year Environmental Action PlanWe largely achieved the targets of the First Five-year Environmental Action Plan, which concluded in thefiscal year ended March 31, 2000. Our major domestic and overseas subsidiaries obtained ISO 14000 orequivalent certification, and we put into place a Group environmental management system. We positionedthe reduction of CO2 emissions as the most important management issue, since CO2 is emitted in all of ourproduction processes. We not only succeeded in holding down increases in CO2 emissions resulting fromproduction increases but also reduced the volume of total CO2 emissions. We were also successful in reducing to zero emissions of manufacturing by-products.Second Five-year Environmental Action PlanThe Second Five-year Environmental Action Plan will run from 2000 through to 2000 and build on theachievements of the first plan. We have already started implementing initiatives that will deliver substantialresults by the final year of the plan.The Second Five-year Environmental Action Plan will take us to the second phase of “Green Manage-ment.” The plan will further expand the scope of group environmental management and allow us to addressenvironmental issues on a global scale, at both domestic and overseas subsidiaries. The plan also has seteven higher goals for environmental protection. In short, the Second Five-year Environmental Action Planaims at ushering in Green Management to meet the needs of the times.Corporate GovernanceBasic Approach and Status of InitiativesTo ensure appropriate operations and transparent management,NGK has set its sights on establishing and maintaining an orga-nization capable of swiftly responding to changes in the businessenvironment, and a fair and open management system thatemphasizes the interests of shareholders.Considering the importance of swift and optimal decision-making and execution, NGK introduced a corporate officersystem, thus separating the management’s decision-making andsupervision functions from business execution functions, andclearly defining the responsibilities of both.Status of Corporate Governance System
NGK has adopted the Corporate Auditor System for corporate
governance. This system is comprised of the following bodies:
Board of Directors
NGK’s Board of Directors is responsible for deliberations and
decisions on matters stipulated by the Corporate Law and on other
issues of vital concern to management, in addition to supervising
the directors in the performance of their duties. The board’s
membership consisted of 12 directors as of March 31, 2000.
Subsequently, following approval at the 141st Annual General
Meeting of Shareholders, NGK has reinforced the supervisory
functions of the board with respect to business execution by
appointing two external directors. Consequently, the Board of
Directors is comprised of 14 members as of the date of NGK’s
securities report filing on June 28, 2000.
Board of Corporate Auditors NGK’s corporate auditors are present at meetings of the Board
of Directors and are involved in other processes that enable
them to supervise the performance of the directors. The Board of
Corporate Auditors has four members, two of whom are from
outside the Company.
Executive Committee
The Executive Committee deliberates issues related to NGK’s
operations, serving in an advisory capacity on matters that are
decided by the president. The committee is comprised of the
president, directors and standing corporate auditors, and the
heads of certain corporate divisions and executive officers
appointed by the president.Resolutions by the Board of Directors Regarding
Systems for Ensuring the Appropriateness of
Business Operations
Pursuant to the Company Law and its enforcement regulations,
the Board of Directors approved resolutions on May 11, 2000 to
develop systems to ensure directors perform their duties in com-
pliance with applicable laws and the Articles of Incorporation,
and systems deemed necessary to ensure the appropriateness
of other NGK business operations.
•Systems to ensure directors perform duties in compliance with
all relevant laws and the Articles of Incorporation
•Systems for the storage and management of information
pertaining to directors’ performance of duties
•Regulations and other systems related to management of risk
of loss
•Systems to ensure directors perform their duties efficiently
• Systems to ensure that employees carry out their duties in com-
pliance with applicable laws and the Articles of Incorporation
•Systems to ensure that the corporate group composed of NGK
and its subsidiaries engages in appropriate business activities
• Items applicable to employees who may be called upon toassist the corporate auditors in their audit duties
• Items regarding the independence of the aforementioned
personnel with respect to the Board of Directors
•Systems for directors and employees to submit reports to the
corporate auditors, and for the reporting of other matters to the
corporate auditors
•Systems to ensure the efficacy of other audits performed by
the corporate auditors
Internal Control Systems
The Board of Directors and the business execution bodies over-
seen by the president are responsible for establishing and oper-
ating NGK’s internal control system. The system consists of the
Auditing Department, a specialist internal audit body for opera-
tions of the company, and specialist committees under the CSR
Committee that construct, maintain and upgrade NGK’s internal
control systems.
CSR Committee
The CSR Committee serves in an advisory capacity to the presi-
dent, deliberating on issues of vital concern to management,
including those related to compliance with laws, regulations,business ethics, accidents and incidents. Subcommittees
responsible for the development of compliance, security, internal
control systems, and corporate citizenship are set up under the
CSR Committee. The Compliance Committee, whose members
include an external consulting attorney, operates the Helpline to
ensure compliance with applicable laws, regulations, and busi-
ness ethics. The Helpline enables employees and others involved
in implementing the NGK Group Guidelines for Corporate Behav-
ior and carrying out NGK’s operations to receive advice on and
to report compliance issues. The main purpose of the Helpline is
to restrict, prevent and resolve quickly any behavior that may run
counter to the guidelines. As expected in an era of consolidated
management, Group companies also come under the auspices
of the CSR Committee.